State spending on public colleges exceeds 2008 levels: report
State funding for public colleges and universities rose 4.9% without accounting for inflation last year and exceeded pre-recession spending per student for the first time since 2008, according to data released Thursday.
State spending per full-time equivalent student in fiscal year 2022 ranged from $3,699 in New Hampshire to $22,970 in Illinois, the State Higher Education Executive Officers Association found in an annual report. Nationally, state education allocations per student were 3.1% higher than 2008 with federal stimulus money included and 0.6% higher without relief funds COVID-19.
State and local funding for higher education totaled $120.7 billion, including more than $2.5 billion in federal stimulus funds. Among public schools, two-year institutions received $55 per student and four-year institutions $169 per student in federal stimulus funds.
It is the biggest investment by state governments in public colleges since sweeping cuts took $33.8 billion from them during the 2008 recession, according to the State Higher Education Finance Association report.
The increase “defied several long-term trends in higher education funding,” the report noted.
“The continued decline in net tuition revenue puts increased pressure on states not to cut funding for public higher education in the coming years,” the report’s authors wrote.
The report notes that full-time enrollment fell for the 11th consecutive year in 2022 and fell faster during the pandemic.
And while tuition fees have risen, net incomes have fallen due to the growing reliance on federal student loans to pay for public higher education.
Public universities enrolled 10.31 million students in 2022, down 2.5% from 2021 and 11.5% from the all-time high in 2011. By comparison, enrollment fell by less than 1% per year on average from 2015 to 2020.
Public financial aid from the state increased by 2% from 2021 to 2022, reaching an all-time high of $990 per student enrolled.
Net tuition revenue per student fell 7.4% at two-year colleges and 0.2% at four-year colleges, according to the report. Overall, net tuition revenue fell 5.8% over five years, reversing a long-term trend of growth dating back to 1980.
According to CollegeBoard, which does not adjust its numbers for inflation, the average in-state tuition for students at a four-year public university rose 1.8%, from $10,740 to $10,740. fall 2021 to $10,950 in fall 2022. For out-of-state students, public college tuition increased 2.2% from $27,560 to $28,240 in during the same period.
The surge in state spending last year contradicts the State Higher Education Executive Officers Association’s 2020 report, which predicted that pandemic shutdowns would force states to cut public higher education to an extent not seen since the recession of 2008.
According to the 2022 report, state appropriations increased 3.8% at community colleges and 4% at public four-year institutions from the previous year.
The state funding increases came as federal COVID-19 stimulus money dried up, sparking clashes in various state legislatures over their obligation to bail out schools.
Inflation-adjusted federal stimulus money for higher education has fallen by $1.4 billion or more by 36% from 2021 to 2022 as many states burn American Rescue Plan funds Act, according to the report.
Despite increases at the national level, the report found that education credits per student declined in 21 states and Washington, DC, during this period.
Allocations fell by more than 20% in three states: Minnesota (21.8%, or $2,729 per student), New Hampshire (20.1%, or $931 per student), and Wyoming (35.1%, or $9,801 per student). The District of Columbia reduced stipends by 28.0% or $10,572 per student.
“These declines were entirely due to states decreasing the amount of stimulus funds allocated to higher education in 2022,” the report noted.
Meanwhile, education funding per student has increased by more than 10% in 29 states. The largest increases were recorded in Georgia (30.3%, or $3,174 per student), New Jersey (25.0%, or $1,790) and Connecticut (23.9%, or 2 $859).
“The increase in Georgia was largely, but not entirely, due to federal stimulus funds,” the report said. “The increase in New Jersey was primarily due to state investment in public operations. In Connecticut, the increase was due to a combination of federal stimulus funds and state investments in public operation.